Unfamiliar Opportunity:  Pitching An Angel Investor Who Doesn’t Know Your Business

Angel Investor

 

According to the Center for Venture Research, angel investments hit $24.8 billion in 2013, up 8.3 percent over 2012.  The number of new ventures winning angel funding also rose—to more than 70,000.  There are certainly opportunities for people looking for funding—if they approach it properly.

But how do you present to an investor who may not know your marketplace?  We consider presentations from a spectrum of industries and groups, many of whom are specialists in new or very technical areas.  Often, we’re not fully conversant in these fields.  But we don’t have to be if the presenters do their job.  Angel investing doesn’t have to come from someone who knows your business.  It comes from someone who knows you.

So if you’re seeking funding from organizations that aren’t within your marketplace, here are some things to consider.

Start With The Opportunity

You don’t have to be an industry expert if you understand the opportunity being presented.  Spell out what you want to do in simple terms.  Use the “elevator pitch” approach—if you had just 60 seconds to explain your idea, tell us what it does, whom it benefits, and how you can make it profitable.

This “framework” is especially important to someone who doesn’t understand a marketplace.  If your audience understands the opportunity, then they can start making connections between it and how your industry works.  The learning curve is accelerated.

Be Visual

Research shows people are more likely to retain knowledge from images than from words.  Good graphics can help with retention, as can images that relate the benefit of your idea to the market.  If your concept is something that could help treat cancer in children, for example, show images of children.  Look to make an emotional connection with your audience.  Then it’s easier for everyone to concentrate on the details that will make the idea work.

If you’re using PowerPoint this is especially important.  PowerPoint is good tool used properly, but a presentation killer if used wrong.  Using more simple slides is better than a few complicated ones, because your message is broken into smaller pieces, and with every slide change, the viewer’s mind “resets” and starts paying more attention again.  Keep this in mind.

Show Your Passion

If you’re not excited about your idea, no one else will be either.  Demonstrate that you believe in your concept, and that you’re willing to invest the time and energy necessary to make it happen.  Energy is contagious:  if you feel it, others will too.

Be Realistic

However, there’s such a thing as being too enthusiastic.  To be credible, you have to be realistic.  Claiming that your idea will do more than what’s reasonable will undermine your presentation.  And if the investor has heard over-the-top presentations before (trust me, the investor has), then the skeptic radar goes up quickly—putting you on the defensive.  Make claims that can be backed by data.  And be prepared to present that data if asked.

Have Details At Hand, But Don’t Focus On Them First

This is where the details come into play.  If the investor asks specific questions, you need to be able to access technical or statistical information to explain your position.  If you’re presenting, sometimes it’s a good idea to build a few extra slides at the end of a presentation that you can use if needed—but not bring up if no one asks.  That way, you look prepared, but you don’t create confusion with a lay audience unnecessarily.  (Note: you can create hyperlinks in your PowerPoint just as you would in a website to quickly move to these slides.)

Sell The Team

Great ideas and evangelical advocates for them are part of what an investor is looking for.  But the organization to actually make the idea move is also critical.  So if a team is working on the project, have them all involved in some way with the presentation.  This builds investor confidence, and it shows that you’re already moving forward.

What do you want to build today?